NEW DELHI : The Supreme Court has asked Bharti Airtel to pay a deposit of Rs 215 crore in the ongoing case on the alleged Customs duty evasion by the company, sources said. This is the ‘differential duty liability’ that the telecom operator had been accused of having evaded, according to a Customs, Excise and Service Tax Appellate Tribunal (CESTAT) order issued in June. Airtel, however, did not respond to an email query on the issue. In the Supreme Court, Airtel was represented by M. P. Devanath, on behalf of law firm Lakshmikumaran & Sridharan. The CESTAT’s Bangalore Bench had asked Airtel to pay around Rs 700 crore for “undervaluation of the imported goods and non-inclusion of the value of software in the imported goods.” The amount due included differential duty liability of Rs 215.51 crore, apart from a similar amount of penalty and a redemption fine of Rs 189 crore for confiscated goods. Additionally, an interest on the duty liability had also been charged on a per-year basis.
According to documents accessed by Business Line, Bharti Airtel was “importing mobile telecom equipment by splitting the value of the equipment into hardware and software components; the hardware was imported first and undervalued to the extent of value of software; that the software imported was dummy and was stored in the warehouse; that hardware comes with the embedded software and is ready to use.” The CESTAT order followed an adjudicating order by the Commissioner of Customs, Bangalore in April 2008. The order had also imposed a penalty of Rs 10 crore on Ericsson India for its involvement. Bharti Airtel then chose to appeal against the order in the CESTAT.